A brief review of current premiums on PMs.

jmski52

I started thinking about another bullion purchase recently, so I started looking at premiums today to get my bearings. Wow, the premiums are quite steep, which could partly be because of the price drop I suppose. I only looked at Apmex because I'm not yet comparison shopping but I was surprised.

1/4 oz AGE, random date, single coin - 10%
1/4 oz AGE, Mint Direct Roll, 2016 - 12%

1/2 oz AGE, random date, single coin - 7%
1/2 oz AGE, Mint Direct Roll, 2016 - 8%

$100 Face 90% Dimes or Quarters - 14%

1 oz. Silver Maples, random date - 12%
500 oz Green Monster Box, ASEs - 15%

5 oz ATB, random date, single coin - 18%
5 oz ATB, Mint Direct Roll - 19%

Very interesting. There's not only high premiums all across the board, but silver seems to be much more sought-after than gold at this time. Is there a run on silver, in spite of - or because of the cratering in price?

cohodk

I think premium are high because metals got crushed yesterday. Check premiums in a week to 10 days.

bronco2078

@jmski52 said:

5 oz ATB, random date, single coin - 18%
5 oz ATB, Mint Direct Roll - 19%

Very interesting. There's not only high premiums all across the board, but silver seems to be much more sought-after than gold at this time. Is there a run on silver, in spite of - or because of the cratering in price?

18% premium on the 5 oz. ? Yikes Another reason that those are the worst form of silver to stack.

ricko

Yep... high premiums seem to have put a damper on PM's ...even though spot is down....this will hold to avert losses. Cheers, RickO

MsMorrisine

APMEX also tends to have a bit higher premiums despite being an authorized purchaser

MsMorrisine

I can't personally say I've bought from all sellers listed
And it is a good idea but with too few comparison sites
Here is a quick view of a few sellers of major gold & silver products

https://comparesilverprices.com/silver-gold-coins-bars/

derryb

lower prices = higher premiums

derryb

rumor on the street is that the US Mint has suspended further sales of 2016 bullion ASEs to its authorized purchasers.

cohodk

An attempt to force a run on 2016s to bail out the APs ahead of the 2017 production.

derryb

@cohodk said:
An attempt to force a run on 2016s to bail out the APs ahead of the 2017 production.

More likely a cease in production to gear up and start striking the 2017's, something they usually do near the end of the year. The fact that their are none left on the shelf to carry them to the end of the year should clue you in to demand.

MsMorrisine

In the past, I've had an AP complain that they have to buy a certain amount of the prior year when buying the new year's run.

no comment of suspended sales. unknown reason for it.

BAJJERFAN

@derryb said:
lower prices = higher premiums

Why?

BAJJERFAN

@MsMorrisine said:
In the past, I've had an AP complain that they have to buy a certain amount of the prior year when buying the new year's run.

no comment of suspended sales. unknown reason for it.

Maybe the mint should offer leftovers to the public, first come first served for the same price that APs pay.

derryb

@BAJJERFAN said:

@derryb said:
lower prices = higher premiums

Why?

sellers trying to cut their losses. When prices are down odds are up that bought at a higher "spot" price. Your large bullion dealers are selling what they recently purchased (at higher prices), they don't sit on the metal.

cohodk

@BAJJERFAN said:

@MsMorrisine said:
In the past, I've had an AP complain that they have to buy a certain amount of the prior year when buying the new year's run.

no comment of suspended sales. unknown reason for it.

Maybe the mint should offer leftovers to the public, first come first served for the same price that APs pay.

The mint should eliminate all AP and sell everything directly to the public. Aren't the APs just another social program? Why not let the miners send their silver to the mint, the mint produces the ASEs for the miners (paying for costs), then the miners sell their silver to the public.

derryb

What? No middle men?

BAJJERFAN

@cohodk said:

@BAJJERFAN said:

@MsMorrisine said:
In the past, I've had an AP complain that they have to buy a certain amount of the prior year when buying the new year's run.

no comment of suspended sales. unknown reason for it.

Maybe the mint should offer leftovers to the public, first come first served for the same price that APs pay.

The mint should eliminate all AP and sell everything directly to the public. Aren't the APs just another social program? Why not let the miners send their silver to the mint, the mint produces the ASEs for the miners (paying for costs), then the miners sell their silver to the public.

The mint uses APs probably for the same reason that Ford and GM use a dealer network. And many large manufacturers use a dealer distribution system. Not worth the hassle to mess with millions of puny orders. I wonder how many takers the mint would get for leftover ASEs if the minimum order was 2 or more monster boxes.

BAJJERFAN

@derryb said:

@BAJJERFAN said:

@derryb said:
lower prices = higher premiums

Why?

sellers trying to cut their losses. When prices are down odds are up that they paid more than current spot. Your large bullion dealers are selling what they recently purchased, they don't sit on the metal.

The question was rhetorical.

cohodk

@BAJJERFAN said:

@cohodk said:

@BAJJERFAN said:

@MsMorrisine said:
In the past, I've had an AP complain that they have to buy a certain amount of the prior year when buying the new year's run.

no comment of suspended sales. unknown reason for it.

Maybe the mint should offer leftovers to the public, first come first served for the same price that APs pay.

The mint should eliminate all AP and sell everything directly to the public. Aren't the APs just another social program? Why not let the miners send their silver to the mint, the mint produces the ASEs for the miners (paying for costs), then the miners sell their silver to the public.

The mint uses APs probably for the same reason that Ford and GM use a dealer network. And many large manufactures use a dealer distribution system. Not worth the hassle to mess with millions of puny orders. I wonder how many takers the mint would get for leftover ASEs if the minimum order was 2 or more monster boxes.

That's why they should send the silver back to the miners from where it came. Or impose a 10 coin minimum. If people can't afford $200 then they shouldn't be buying it in first place .

BAJJERFAN

@derryb said:

@BAJJERFAN said:

@derryb said:
lower prices = higher premiums

Why?

sellers trying to cut their losses. When prices are down odds are up that they paid more than current spot. Your large bullion dealers are selling what they recently purchased, they don't sit on the metal.

I see the one AP that publishes their sell prices has raised their 2016 ASE sell price about 46 cents with no discount for larger buys. So it's not just dealers who are holding higher priced inventory that raise prices.

BAJJERFAN

@cohodk said:

@BAJJERFAN said:

@MsMorrisine said:
In the past, I've had an AP complain that they have to buy a certain amount of the prior year when buying the new year's run.

no comment of suspended sales. unknown reason for it.

Maybe the mint should offer leftovers to the public, first come first served for the same price that APs pay.

The mint should eliminate all AP and sell everything directly to the public. Aren't the APs just another social program? Why not let the miners send their silver to the mint, the mint produces the ASEs for the miners (paying for costs), then the miners sell their silver to the public.

IMO, the mint/Government has no business being a contractor for/to private businesses esp. when it involves minting money. YMMV.

cohodk

Are they not contractors for the APs now?

Let's do away with all mint products anyway. Less than 1% of population cares about this stuff anyway. Let them just make coins for circulation.

BAJJERFAN

@cohodk said:
Are they not contractors for the APs now? >

NO.

TwoSides2aCoin

The government ( mint/treasury) is not in the business of making money ... They're in the business of taking it. And they're the same ones who are allowed to gouge us for it.

jmski52

Nov. 12 Data:

_1/4 oz AGE, random date, single coin - 10%
1/4 oz AGE, Mint Direct Roll, 2016 - 12%

1/2 oz AGE, random date, single coin - 7%
1/2 oz AGE, Mint Direct Roll, 2016 - 8%

$100 Face 90% Dimes or Quarters - 14%

1 oz. Silver Maples, random date - 12%
500 oz Green Monster Box, ASEs - 15%

5 oz ATB, random date, single coin - 18%
5 oz ATB, Mint Direct Roll - 19%_

UPDATE - Dec. 12 Data:

1/4 oz AGE, random date, single coin - 10.8%
1/4 oz AGE, Mint Direct Roll, 2016 - 12.6%

1/2 oz AGE, random date, single coin - 7.5%
1/2 oz AGE, Mint Direct Roll, 2016 - 8.5%

$100 Face 90% Dimes or Quarters - 12.2%

1 oz. Silver Maples, random date - 12.3%
1 oz. ASE, random date - 23.4%
500 oz Green Monster Box, ASEs - 17.5%

5 oz ATB, random date, single coin - 15.8%
5 oz ATB, Mint Direct Roll - 18.1%

It's been awhile since I've gone shopping for silver, but compared to historical premiums, these premiums are very high. The gold premiums are fairly close to what I know as historical norms.

Are we expecting a silver shortage, or is there one already?

Or, are dealers buried in old inventory bought at higher prices? That wouldn't explain why gold premiums are fairly close to normal.

Just wondering out loud.

derryb

Premiums for the real stuff will continue to rise as prices for the paper stuff continue to fall. It's the only way sellers of the real stuff can cut their losses.

BAJJERFAN

@jmski52 said:
Nov. 12 Data:

_1/4 oz AGE, random date, single coin - 10%
1/4 oz AGE, Mint Direct Roll, 2016 - 12%

1/2 oz AGE, random date, single coin - 7%
1/2 oz AGE, Mint Direct Roll, 2016 - 8%

$100 Face 90% Dimes or Quarters - 14%

1 oz. Silver Maples, random date - 12%
500 oz Green Monster Box, ASEs - 15%

5 oz ATB, random date, single coin - 18%
5 oz ATB, Mint Direct Roll - 19%_

UPDATE - Dec. 12 Data:

1/4 oz AGE, random date, single coin - 10.8%
1/4 oz AGE, Mint Direct Roll, 2016 - 12.6%

1/2 oz AGE, random date, single coin - 7.5%
1/2 oz AGE, Mint Direct Roll, 2016 - 8.5%

$100 Face 90% Dimes or Quarters - 12.2%

1 oz. Silver Maples, random date - 12.3%
1 oz. ASE, random date - 23.4%
500 oz Green Monster Box, ASEs - 17.5%

5 oz ATB, random date, single coin - 15.8%
5 oz ATB, Mint Direct Roll - 18.1%

It's been awhile since I've gone shopping for silver, but compared to historical premiums, these premiums are very high. The gold premiums are fairly close to what I know as historical norms.

Are we expecting a silver shortage, or is there one already?

Or, are dealers buried in old inventory bought at higher prices? That wouldn't explain why gold premiums are fairly close to normal.

Just wondering out loud.

You can do better than the 17.5% APMEX premium for MBs of 2016 ASES.

jmski52

You can do better than the 17.5% APMEX premium for MBs of 2016 ASES.

No doubt that's true, but if I update this market snapshot from time to time, it becomes more relevant if I hold the pricing source constant. Apmex is also more likely to maintain their pricing model constant since they are a primary Mint distributor.

So, let me ask you - what do you think is going on with silver?

cohodk

__So, let me ask you - what do you think is going on with silver?

Dealers are buried in it and don't want to let it go at what it's worth, so they sit on it. Some even make up fake news stories to explain why silver should be worth a lot more but is being superseded by "them".

Sarcasm aside, the truth is in my first sentence.

derryb

@jmski52 said:

So, let me ask you - what do you think is going on with silver?

As i stated above, "premiums for the real stuff will continue to rise as prices for the paper stuff continue to fall. It's the only way sellers of the real stuff can cut their losses."

As long as buyers pay these higher premiums it is selling "for what it's worth." Worth is determined by the buyer, not the seller. There has always been, and will continue to be two prices for PMs - the paper price and the physical price. While physical price uses paper price as its basis a continually rising differential between the two is the result of where confidence in the two stands.

Rising premiums also reflect a growing loss of confidence in the paper and/or a rising confidence in the physical. Market prices are based on confidence and confidence is rooted in perception.

BAJJERFAN

@jmski52 said:
_

>

So, let me ask you - what do you think is going on with silver?

TBH, I have no idea what's going on with silver. With low prices it doesn't seem to be moving which suggests poor demand. Cohodk is probably right that dealers are stuck with higher priced stuff, but I have not checked with any to find out. Have not bought much myself lately except for a few bars. Places that used to have lots of ads for the stuff are way down and hardly anyone looking for or selling ASEs. Maybe folks are saving their $$$ for the 2017s.

Also in checking APMEX's site they don't have a buy price posted for the 2016 ASEs which signals to me that they got plenty. I do see that another AP is paying $1.90 over for sealed boxes of same.

DrBuster

Money is working elsewhere other than silver/PMs currently. 20k Dow is proving that I'd say.

That being said, I gladly paid silly premium yesterday for some 1/2 and 3/4 oz stuff to give out for xmas - hello ~$26 silver. Free shipping helped balanced it out a little bit for the variety stuff I was wanting, even in the smallish quantity I ordered (moreso probably).

Last year was about the same spot unless you caught the quick sub 15 dip. I grabbed some then, not much, and would grab some for personal pirate chesting this year as well if/when it drops a tick more and I'm sub or around spot+2 for the stuff I would get.

cohodk

@BAJJERFAN said:

@jmski52 said:
_

>

So, let me ask you - what do you think is going on with silver?

TBH, I have no idea what's going on with silver. With low prices it doesn't seem to be moving which suggests poor demand. Cohodk is probably right that dealers are stuck with higher priced stuff, but I have not checked with any to find out. Have not bought much myself lately except for a few bars. Places that used to have lots of ads for the stuff are way down and hardly anyone looking for or selling ASEs. Maybe folks are saving their $$$ for the 2017s.

Also in checking APMEX's site they don't have a buy price posted for the 2016 ASEs which signals to me that they got plenty. I do see that another AP is paying $1.90 over for sealed boxes of same.

ASE sales are down nearly 10 million coins from last year. That's a 20% decline.

cohodk

For the greater part of the last 10 years silver has been roughly where it is today. With the exception of a 2 year period---where most folks are buried--no stackers have made any money, save for a few nimble folks in this board.

Folks are tired of the head fakes and false promises. They are tired of the hype and hyperbole. They've watched stocks double, home prices come back and they look at their silver orbs and question themselves. They don't want any more. They've had enough.

We have to wait for the next generation of idealists and sorry to say, ignorant, to share the fear and anxiety and greed that we did. Until then, the commodity bear super cycle lumbers along.

rawteam1

@derryb said:

@jmski52 said:

So, let me ask you - what do you think is going on with silver?

As i stated above, "premiums for the real stuff will continue to rise as prices for the paper stuff continue to fall. It's the only way sellers of the real stuff can cut their losses."

As long as buyers pay these higher premiums it is selling "for what it's worth." Worth is determined by the buyer, not the seller. There has always been, and will continue to be two prices for PMs - the paper price and the physical price. While physical price uses paper price as its basis a continually rising differential between the two is the result of where confidence in the two stands.

Rising premiums also reflect a growing loss of confidence in the paper and/or a rising confidence in the physical. Market prices are based on confidence and confidence is rooted in perception.

@derryb said:

@jmski52 said:

So, let me ask you - what do you think is going on with silver?

As i stated above, "premiums for the real stuff will continue to rise as prices for the paper stuff continue to fall. It's the only way sellers of the real stuff can cut their losses."

As long as buyers pay these higher premiums it is selling "for what it's worth." Worth is determined by the buyer, not the seller. There has always been, and will continue to be two prices for PMs - the paper price and the physical price. While physical price uses paper price as its basis a continually rising differential between the two is the result of where confidence in the two stands.

Rising premiums also reflect a growing loss of confidence in the paper and/or a rising confidence in the physical. Market prices are based on confidence and confidence is rooted in perception.

@derryb said:

@jmski52 said:

So, let me ask you - what do you think is going on with silver?

As i stated above, "premiums for the real stuff will continue to rise as prices for the paper stuff continue to fall. It's the only way sellers of the real stuff can cut their losses."

As long as buyers pay these higher premiums it is selling "for what it's worth." Worth is determined by the buyer, not the seller. There has always been, and will continue to be two prices for PMs - the paper price and the physical price. While physical price uses paper price as its basis a continually rising differential between the two is the result of where confidence in the two stands.

Rising premiums also reflect a growing loss of confidence in the paper and/or a rising confidence in the physical. Market prices are based on confidence and confidence is rooted in perception.

@derryb said:

@jmski52 said:

So, let me ask you - what do you think is going on with silver?

As i stated above, "premiums for the real stuff will continue to rise as prices for the paper stuff continue to fall. It's the only way sellers of the real stuff can cut their losses."

As long as buyers pay these higher premiums it is selling "for what it's worth." Worth is determined by the buyer, not the seller. There has always been, and will continue to be two prices for PMs - the paper price and the physical price. While physical price uses paper price as its basis a continually rising differential between the two is the result of where confidence in the two stands.

Rising premiums also reflect a growing loss of confidence in the paper and/or a rising confidence in the physical. Market prices are based on confidence and confidence is rooted in perception.

@derryb said:

@jmski52 said:

So, let me ask you - what do you think is going on with silver?

As i stated above, "premiums for the real stuff will continue to rise as prices for the paper stuff continue to fall. It's the only way sellers of the real stuff can cut their losses."

As long as buyers pay these higher premiums it is selling "for what it's worth." Worth is determined by the buyer, not the seller. There has always been, and will continue to be two prices for PMs - the paper price and the physical price. While physical price uses paper price as its basis a continually rising differential between the two is the result of where confidence in the two stands.

Rising premiums also reflect a growing loss of confidence in the paper and/or a rising confidence in the physical. Market prices are based on confidence and confidence is rooted in perception.

@derryb said:
Rising premiums also reflect a growing loss of confidence in the paper and/or a rising confidence in the physical. Market prices are based on confidence and confidence is rooted in perception.

>
This reminds me of the paper the blind guy wrote when he had to describe an elephant, being only allowed to touch his tail...

derryb

. . . and some lack the ability to comprehend even the basics. lol.

rawteam1

Yea all the dealers at the shows told me their premiums were high because loss of confidence in paper and confidence in metals,
lol, I saw a lot of people screaming how they couldn't buy any gas or food with that paper stuff, crazy, all the people running around coin shows screaming, funny thing though was those dealers with high premiums packed all their confidence in metals back up into their cars again for the next weekend to find out if confidence is up down or sideways...

derryb

Obviously those dealers are confident in their price. Wonder why?

basic stuff, study up.

TwoSides2aCoin

I buy and sell. I'm not buried in it. LOL. Just to dispel "rumors".

cohodk

@TwoSides2aCoin said:

I buy and sell. I'm not buried in it. LOL. Just to dispel "rumors".

What premium do you charge? Ballpark.

topstuf

No one has any money.

rawteam1

@derryb said:
Obviously those dealers are confident in their price. Wonder why?

basic stuff, study up.

@derryb said:
Obviously those dealers are confident in their price. Wonder why?

basic stuff, study up.

I don't know maybe ask them today, lol...

Amazing your still drinking your own kool-aid...

Baley

"Premiums" depend on many things, including how nice the pieces of metal are to look at, and how motivated are the buyers and sellers at the time of the transaction. Sellers can sometimes motivate buyers by being persuasive with the quality of the goods and the sales pitch, however, buyers can rarely if ever motivate retail sellers to lower their prices.

jmski52

Still, why are silver premiums higher than historic silver premiums while gold premiums seem to be about what they've always been? Have the fundamentals changed for one, but not the other?

cohodk

Volatility determines premium. Silver is more volatile.

derryb

Silver is more volatile than gold, but it has nothing to do with premiums. Volatility of silver prices has remained mostly constant over the years, yet premiums have steadily increased. The biggest factor to silver premiums is seller's net. If he bought at a higher spot price he is going to ask more premium to cut his losses. At $47 silver premiums were lower because the sellers' net without it was much higher.

rawteam1

@derryb said:
Silver is more volatile than gold, but it has nothing to do with premiums. Volatility of silver prices has remained mostly constant over the years, yet premiums have steadily increased. The biggest factor to silver premiums is seller's net. If he bought at a higher spot price he is going to ask more premium to cut his losses. At $47 silver premiums were lower because the sellers' net without it was much higher.

All your statements are quite general, don't serve us up wiz and call it champagne...

Years? How many? Premiums haven't increased at all for all intensive purposes 10-15 years ago to buy was spot plus .50 - 1 for generic its same now many times less than .50, it's same for 100oz bars...

Volatility constant??? Who you trying to kid?
Moves like yesterday were unheard of decades ago, penny moves the norm for decades ...

and who is seller? Who is he? Joe Schmoe ??? Asking for premium is meaningless kinda like home equity until you sell and pocket, when a couple large retail bullion retailers go bust that's when bottom may be in...

derryb

Decades ago is. . . decades ago.

Asking for premium is one thing. Buyers are paying higher premiums. Do your homework before you come to class. At lease your mentor reads the Cliff Notes.

cohodk

ASEs had a $3-4 premium last year. What is the premium now? Its the same. Any changes in premium are HIGHLY, dependant on volatility. There may be some seasonality effect on collector stuff, especially around the religous holiday, but haven't researched that.

rawteam1

@derryb said:
Decades ago is. . . decades ago.

Asking for premium is one thing. Buyers are paying higher premiums. Do your homework before you come to class. At lease your mentor reads the Cliff Notes.

lol, you should run for political office, always skirting the questions, never can answer...

Decades, yes, elementary except to you...

derryb

Maybe you just don't like the answers. lol.

I'm sure you can find what you want to hear if you look harder.